Television Media Average CPM Rate

Video Television Media Advertising,

According to tracking firms in the TV space,

Average cpm for TV Ads,

The going rate to run a 30-second spot on the average network prime-time show is $110,200, at a $25 cost per 1,000 homes. Factor in the significant number of viewers who are DVR-ing the ads – let’s even be conservative and say 25% of viewers skip ads – and the true CPM cost is a lot higher.
That’s because at least 25% of the viewers for whom the advertiser is paying aren't watching the ad. So the true cost to reach the viewers of the primetime 30-second spot is more like $33 CPM, according to the following calculation: $25 CPM / (1 – 25%) = $33.33 CPM.

Contrast that with recent announcements that popular television channels are now making preroll RTB video ads available on their full-episode players. What do CPMs for the online episode players look like? They’re in the $21 to $30 CPM range, or significantly lower than running on TV. Video with professionally produced content is an even better deal with average CPMs of $11 to $20.

How to Calculate the CPM for Television?

An advertisement on television can be a costly investment, but it is a great way to get your product seen by lots of people at once. The best way to know if you are getting your money's worth is to calculate the CPM of your ad. CPM is an acronym for cost per mille, which means the cost of getting your ad in front of 1,000 people. To determine how much you are spending on your advertising space per eyeball, use a few simple figures to ascertain your CPM.

Ratings Are Everything

The best way to get an accurate CPM for a television advertisement is to know how good the ratings are of the television show with which your ad plays. Nielsen ratings are the golden standard for estimating the popularity of a television show. The average for a network series is 11 percent of the television-owning American population, which is estimated to be 94 million households, according to the Museum of Broadcast Communications. That means a show with ratings of 11 percent reaches 10.3 million people. The more popular a show is, the more expensive advertising even social advertising around it will be. A less-expensive example would be a show that is seen by 5 million people.

The Equation

If your ad is featured next to an average television show that garners 5 million viewers, then you can use that figure to determine your CPM when you compare it to the price of advertising. First, divide the viewer number by 1,000, since you are calculating the cost of one thousand viewers. The amount you are working with now is 5,000. If you buy a single thirty-second advertising slot for $10,000, then divide that price by 5,000 for a CPM of $2. This is the cost per 1,000 people if you buy $10,000 of ad time during a show that gets 5 million viewers.

Making the Most of Your CPM

The best way to get a good deal on television ad time is by purchasing in advance. Once a year, typically in May, networks sell advertising slots for the upcoming international television season at what is known as the upfront market. You are taking a chance by buying in bulk for a network that will be testing out new series in the fall, but often there are some guarantees. If a network fails to attract the ratings they promise to advertisers, they run free commercials to make up for it.

The Future of CPM

With the evolution of technology that delivers media over the Internet, there have been the beginnings of big changes with analyzing television show ratings. Any new method of counting viewers will have an effect on determining CPM. A Microsoft patent on Nov. 1, 2012, reveals that XBox Kinect machines are being created to count viewers in the room. This may be used to charge viewers by how many people are watching, rather than by household. Regardless of whether household televisions or viewer totals will be used to determine ratings, using that number to calculate CPM for a television advertisement will likely remain the same.

Households
Viewing

Avg. Min.

Cost Per

30 Sec.

Cost Per

1000 Homes

1965

9,968,000

$19,700

$1.98

1966

9,873,000

19,400

1.96

1967

10,007,000

20,400

2.04

1968

11,260,000

22,200

1.97

1969

11,040,000

22,800

2.07

1970

11,430,000

24,000

2.10

1971

12,000,000

21,700

1.81

1972

12,790,000

25,100

1.96

1973

12,600,000

28,900

2.29

1974

13,380,000

30,400

2.27

1975

13,500,000

32,200

2.39

1976

13,720,000

33,000

2.41

1977

14,380,000

42,300

2.94

1978

14,620,000

45,700

3.12

1979

14,910,000

58,100

3.89

1980

15,240,000

57,900

3.79

1981

14,720,000

60,700

4.12

1982

14,140,000

69,900

4.94

1983

15,150,000

81,300

5.36

1984

14,530,000

107,500

7.39

1985

14,510,000

94,700

6.52

1986

14,460,000

98,500

6.81

1987

14,290,000

100,100

7.00

1988

13,250,000

109,000

8.22

1989

13,060,000

109,400

8.37

1990

12,540,000

122,200

9.74

1991

11,810,000

106,400

9.00

1992(1)

12,020,000

93,700

7.79

1993

11,070,000

92,700

8.37

1994

12,710,000

97,200

7.64

1995

10,860,000

95,500

8.79

1996

9,940,000

101,400

10.20

1997

9,530,000

106,500

11.18

1998

9,640,000

121,300

12.59

1999(2)

8,256,000

110,700

13.41

2000(3)

6,134,000

82,300

13.42

2001

5,885,000

88,700

15.07

2002

6,472,000

108,700

16.79

2003

5,822,000

89,100

15.31

2004

6,070,000

120,500

19.85

2005

6,043,000

129,600

21.45

2006(4)

5,670,000

127,800

22.55

2007

5,151,000

117,800

22.87

2008

4,384,000

114,900

26.22

2009

4,562,000

103,700

22.72

2010

5,248,000

103,600

$19.74

2011

4,710,000

106,500

$22.61

2012

4,630,000

111,500

$24.08

2013

4,397,000

110,200

$25.06

* Regular programs & specials

SOURCE: NIELSEN MEDIA RESEARCH, FEBRUARY EACH YEAR
Notes:

(1) FOX added in 1992

(2) WB added in 1999

(3) UPN & Pax added in 2000

(4) Univision added in 2006. Effective January 2006, all audience estimates are based on Live+7 data.